Customer fraud protection products for banks and credit unions

According to the 2018 AFP Payments Fraud Survey, instances of fraud reached an all-time high last year – 78 percent of organizations were victims of fraudulent activity. The study also revealed that checks were the most common source of fraud, as 74 percent of survey respondents experienced check fraud. As these numbers grow, many financial institutions, like West Jordan, Utah-based Mountain America Credit Union, have recognized the need for more effective security measures to protect their members from fraud.

Overcoming an Industry-Wide Challenge:

When an unauthorized transaction occurs, businesses are required by regulation to report fraudulent activity within two days compared to the 60-day timeframe allotted to consumers. Such a limited timeframe to report and dispute fraud oftentimes makes it harder for businesses to recover stolen funds. In an effort to attract more business and commercial members, Mountain America Credit Union needed a way to help these members quickly detect and respond to suspicious transactions, specifically checks and ACH debits, and protect their hard-earned funds from fraudsters.

Today’s online banking systems boast extensive capabilities, from opening an account to setting up automatic bill payments, mobile check deposits and more. Despite these comprehensive feature functionalities, the fraud detection and dispute process remains antiquated for many financial institutions. While online banking systems offer visibility over transactions for account holders, these systems do not allow account holders to take action and protect themselves against suspicious activity.

For instance, when a customer logs into their online banking portal, they can view all of their transactions, including checks, ACH, wire, internal transfers and debit card transactions. However, if the customer notices an unfamiliar charge, like an ACH debit, they can only see the amount and the company that initiated the transaction with no additional details about what the charge was for. From there, the customer must call their financial institution to research the transaction. After the institution researches the transaction, the customer may choose to dispute it. In order to dispute the transaction, the customer must visit the branch and complete a dispute form. After filling out the form, it may be ten days before the customer’s money is back in their account.